8. Cloudflare Inc. (NYSE:NET)
Number of Hedge Fund Holders — 87
Value of Holdings — $3.98 billion
Cloud Infrastructure Accelerates While Margins Face Pressure
Cloudflare, Inc. (NYSE: NET) delivered second-quarter 2026 revenue of $696.1 million, a 36% increase. Current remaining performance obligations grew 35%, providing another indicator of contracted demand alongside recognized sales.
The company combines network security, application performance, and developer infrastructure. Its pitch is that businesses can obtain several essential Internet services through one platform, reducing the complexity of managing separate systems.
The financial picture is less tidy than the growth headline. GAAP gross margin declined to 71.8% from 74.9% a year earlier, and the GAAP operating loss widened to $205.7 million. Non-GAAP operating income was $96.1 million, while free cash flow totaled $56.4 million. Management forecast full-year revenue of $2.864 billion to $2.870 billion.
These figures make margin conversion central to the cloud stock investment case. A larger revenue base creates opportunity, but investors still need evidence that growth can support stronger reported profitability. The gap between GAAP losses and adjusted earnings also makes the reconciliation essential reading.
Ranking Rationale
Cloudflare, Inc. (NYSE: NET) ranks eighth with 87 hedge fund holders and $3.98 billion in combined holdings. Its holder count places it ahead of the first two entries, but below the two cybersecurity businesses tied at 89 holders.
